Japan's gov't steps back from LDP postal privatization plan

20:16, March 24, 2010      

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The government led by the Democratic Party of Japan (DPJ) on Wednesday unveiled a plan to roll back an Liberal Democratic Party (LDP) initiative that would have seen the nation's postal service fully privatized.

Financial Services Minister Shizuka Kamei said at a news conference that under a bill to be put before parliament, the state will retain more than one third of the shares in Japan Post Holdings Co. that it currently owns.

The move will pull back a plan put forward by the administration of Prime Minister Junichiro Koizumi that would have seen the postal service fully privatized. On the basis of that plan, the LDP crushed the opposition in the so called "postal vote " of 2005.

Since then, sentiment in Japan has changed amid an economic downturn that has put many of Koizumi's pro-market reforms in a new light.

The Koizumi plan for the postal service would have seen the institution fully privatized by 2017.

Under the DPJ plan, the government will retain some control over the institution, while giving it more freedom to expand its operations and allowing larger deposits to be placed within its banking service.

The bill on postal reform is expected to be sent to parliament in April, just a few months before a key upper house election.

Source: Xinhua
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